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M&M in parleys with Renault for MCV, mini-van

K Giriprakash

Mahindra & Mahindra is in talks with Renault of France to manufacture medium commercial vehicles and a mini van.

This follows M&M's tie-up with Renault, one of the six major auto makers in the world, for sourcing engines for its multi-utility vehicle Bolero and its sports utility vehicle, codenamed Project Scorpio. The mini van is expected to be similar to Renault's Espace.

M&M is also gearing up to roll out Bolero and the SUV in Russia, Georgia and other countries.

Alan Durante, executive director and president, said the company is scouting for joint venture partners in these countries.

"We plan to sell 2,000 SUVs and 300 units of Bolero every month in the Commonwealth of Independent States," Durante said.

Renault's petrol engines for Bolero and Project Scorpio have been specifically developed and adapted for M&M vehicles.

Durante said continuing reduction in the differential between petrol and diesel prices may lead to higher demand for petrol-powered MUVs in the country.

While the plant in Georgia will roll out Bolero in two months, the company is in talks with various auto companies to assemble Scorpio there.

Nearly 25 per cent of Bolero's parts will be sourced from Georgia itself.

Durante said M&M expects the lesser duties in Georgia will bring down Bolero's price. In India, the model is priced around Rs 5 lakh (Rs 500,000).

Scorpio will be launched in 25 cities in India. "We will have around 800 of these vehicles and will be priced aggressively," Durante said. He said it is expected to eat into the mid-sized car market. "The name of the vehicle and its price will be announced during its launch," Durante said.

Within six months of its launch, several variants of the vehicle will also be introduced. The vehicle is being manufactured at its Nashik, Maharashtra plant.

Durante said Rs 550 crore (Rs 5.5 billion) has been invested in Project Scorpio and the company expects to sell around 1,500 vehicles every month in India.

He said Bolero's sales were as per target, with nearly 700 to 800 units were being sold every month. In the multi-utility vehicle market, M&M's share is around 48 per cent.

Durante said that to ensure global levels of quality, design and validation inputs for Project Scorpio, consultant AVL of Austria, and suppliers such as Lear Corporation, Dana Spicer, Visteon and Samlip have been roped in.

Project Scorpio will spearhead M&M's entry into the manufacture of next generation vehicles and will eventually become the platform for all its MUVs. The Scorpio will have a number of variants to cover MUV segments, Durante said.

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